Industry Alignment

• Significant engagement regarding Zespri Global Supply (ZGS), its role in Zespri’s 12-month supply strategy, and its importance in protecting grower returns
• Industry tours to visit European growers and learn more about ZGS operations and performance
• Increased visibility of ZGS operations and performance, including a dedicated section in the 2024 Five-Year Outlook
• Confirmation of the Producer Vote seeking grower support for the expansion of offshore SunGold hectares as part of a wider plan to reach 12-month supply with key customers in key markets, maintaining our volume share and therefore our value proposition, ultimately supporting our price premium.

Read more about ZGS and the launch of the producer vote to support New Zealand grower returns here.

• Focus on resetting fruit quality to ensure we sell as much as we can of what we grow, with fruit quality this year the best in 5 years
• New digital systems give us unprecedented ability to monitor fruit quality and manage inventory to prioritise selling softer fruit to reduce quality costs
• Markets exploring process options such as infused teas where these make commercial sense.

• Established Kiwifruit Breeding Centre to develop new varieties faster
• 13 new varieties including kiwi berries in pre-commercial trials (the final part of the trial process before commercialisation)
• New ascending auction licence release mechanism and Green cutover pool
• Discussion on new licence release mechanism to begin in 2025, considering alternatives to the current up front cost. Read more about the 2025 licence release rules and how to buy licence here. 
  

The successful implementation of this project is expected to result in:

• Enhanced transparency and inclusivity in industry decision making.
• More efficient and effective decision-making processes within the IAC and ISG.
• Greater alignment of industry policies with the needs and expectations of growers and other stakeholders.

Improving industry decision making is crucial for the sustainable growth and development of the kiwifruit industry. By enhancing transparency, stakeholder participation, and process efficiency, this project aims to create a more robust and inclusive framework for industry governance. We look forward to working with all stakeholders to achieve these goals and ensure the continued success of our industry.

We’ll be publishing the decisions the IAC and ISG make here, so stay tuned for further updates. 

The Industry Advisory Council (IAC) is a pan-industry body comprising five representatives each from Zespri, NZKGI, and registered suppliers. It is tasked with considering significant pan-industry issues, including strategic industry policy, governance, and structure.

Voting process: Voting within the IAC is conducted in three electoral colleges representing each membership group. Each group functions as an "electoral college" and each IAC member has one vote. For a vote to pass, a majority of the members in each electoral college must vote in favor. Specifically, at least three of the five representatives in each group must support a recommendation for it to be approved.

Transparency and participation: IAC meetings are held bi-monthly and are open forums where growers and industry participants can attend or observe. Other groups may also be invited to provide additional information, subject to confidentiality requirements. Speaking rights are reserved for the designated representatives unless pre-agreed with the Chairman.

The Industry Supply Group (ISG) includes five representatives from Zespri, one representative from each of the 13 Registered Suppliers, and three grower-appointed representatives from NZKGI. The ISG's responsibilities include operational planning within the supply chain, insurance matters, supplier accountability, and the negotiation of the industry Supply Agreement.

Decision-making process: Most decisions within the ISG are made by consensus among the three parties (Zespri, Suppliers and NZKGI). However, if consensus cannot be reached, a recommendation must be supported by both Zespri and Registered Suppliers representing 70 percent of the industry's trays. A single supplier representing 30 percent of the trays cannot veto a recommendation supported by all other suppliers.

As part of ongoing legal activity to protect the Zespri brand, Zespri has recently completed successful prosecutions against three individuals in China for the online sales of locally grown fruit with counterfeit Zespri labels to the value of more than NZ$700,000.

The offenders were each sentenced to three years and nine months in jail and ordered to pay a fine of 550,000 yuan (NZD 125,000).

The prosecutions reflect a local crackdown on those involved in counterfeiting registered trademarks, effectively safeguarding corporate trademark rights, and protecting consumer interests. They follow a series of police raids against sellers buying local kiwifruit to sell through stores set up on an e-commerce site earlier this year. 

The manufacturers and vendors of the counterfeit trademark labels supplied to the convicted trio have also been charged and that case is ongoing. The Shanghai Public Prosecutor and the Zespri team in China have both issued press releases on the successful anti-counterfeit operation and the heavy penalties imposed which has been widely reported in Chinese media, serving as a powerful deterrent. 

Zespri has also filed further legal action to recover damages from those involved in the propagation of Gold3 plantings as part of our commitment to protecting the industry’s investment and intellectual property rights.

Zespri has filed a petition in a Chinese court to recognise and enforce the judgement of the New Zealand Court of Appeal against those found to have taken the original budwood out of New Zealand to China. This is in order to recover remaining damages from the $12 million awarded to Zespri after Haoyu Gao and his associates were found guilty of fraudulently offering to license Zespri varieties to parties in China and facilitated the planting of these varieties on Chinese orchards.

Our civil litigation case in the Intellectual Property Court in Nanjing against two defendants linked to the unauthorised production, sale, and marketing of illegally grown G3 is also continuing. We have been encouraged by the recent success of T&G’s plant variety rights infringement civil case in China, related to the illegal growing of its Envy apple variety. T&G was awarded its full claim for damages in the case, with the case demonstrating the increased protection for PVRs made possible by changes to China’s Seed Law in 2022. Late last year, T&G celebrated the first sales of its locally grown Envy Apples in China, following an agreement reached in 2018 that granted Joy Wing Mau a licence to grow and sell managed volumes of Envy apples to the local China market.

October 2024 Update

Zespri’s civil case in China to address unauthorised Gold3 plantings is continuing and will be transferred to the Wuhan Intermediate People’s Court.

The Wuhan Intermediate People’s Court is an experienced intellectual property court and has heard numerous cases relating to plant variety right infringement.

It is anticipated the court will issue an initial judgement within 12-months.

The civil case, filed in July 2023, is a significant step in our ongoing efforts to protect the investment made by New Zealand producers in licensed kiwifruit varieties, as well as the interests of our customers and consumers. We will continue to keep the industry updated as the civil case progresses.